CHENNAI: A day after carrying out raids at 35 places across India, the Central Bureau of Investigation arrested five persons on Thursday. The arrested persons include promoters and directors of Jayam Industries (rechristened Annamalai Industries), AV Madhav Rao, Uma Shankar Gupta and P V Srinivasa
Rao, the designated officer of Thiruvallur Food Safety and Drug
Administration department, Dr P Senthil Murugan, and the Superintendent of Customs and Excise department, N K Pandian, a CBI spokesman said. The five arrests constitute the first breakthrough in the case which was handed over to the CBI by the Madras High Court. The FIR was filed by the CBI on May 28 and raids were conducted at 35 places across the country, including the premises of State Health Minister Vijay Baskar and Director General of Police T K Rajendran on Wednesday.
Meanwhile, two persons Rajendran and Nandakumar, who acted as middlemen in making payments to the minister, cops and Central Excise officials, are still under the CBI custody
The CBI took up the case after the Madras High court, in its judgement dated April 26, directed the CBI to conduct investigation into all aspects of the offence of illegal manufacture, import, supply, distribution and sale of gutka and other forms of chewable tobacco which are banned in Tamil Nadu and Puducherry. The order also includes detection of and action against those involved in the offence.
As per the statement given by Madhava Rao, one of the partners of Jayam Group, which was recorded by the Income Tax department, the state and Central government officials were bribed for turning a blind eye to manufacture and sale of gutka that was banned in Tamil Nadu in 2013.
The Income Tax department, in a letter to the state government, had alleged that gutka trade in Chennai flourished despite the ban imposed as the merchant bribed the Health Minister, the Chennai Police Commissioner, the Chennai Corporation, the Food Safety and Central Excise department officials.
Interestingly, the arrest of the two state and Central government officials, along with the two promoters and directors of the company, would pave the way for an Enforcement Directorate investigation under the Prevention of Money Laundering Act. The ED also registered a case against the Central and state government officials and others in gutka case on June 8, 2018.
The gutka scam came to light on July 8, 2017, when Income Tax sleuths raided offices and residences of Jayam Industries (now known as Annamalai Industries) which had been facing charges of tax evasion to the value of Rs 250 crore and seized a diary containing incriminating evidences linking top officials of the state.
The case further gained prominence after Income Tax sleuths, while inspecting the Poes Garden residence of late CM Jayalalithaa, stumbled upon letters exchanged between the Income Tax department and top bureaucrats of the State over the case in November 2017. All five arrested have been remanded in judicial custody till September 20 by a CBI court in Chennai.